Risk Management

Introduction

A “business associate” is a person or entity, other than a member of the workforce of a covered entity, who performs functions or activities on behalf of, or provides certain services to, a covered entity that involve access by the business associate to protected health information. A “business associate” also is a subcontractor that creates, receives, maintains, or transmits protected health information on behalf of another business associate. The HIPAA Rules generally require that covered entities and business associates enter into contracts with their business associates to ensure that the business associates will appropriately safeguard protected health information. The business associate contract also serves to clarify and limit, as appropriate, the permissible uses and disclosures of protected health information by the business associate, based on the relationship between the parties and the activities or services being performed by the business associate. A business associate may use or disclose protected health information only as permitted or required by its business associate contract or as required by law. A business associate is directly liable under the HIPAA Rules and subject to civil and, in some cases, criminal penalties for making uses and disclosures of protected health information that are not authorized by its contract or required by law. A business associate also is directly liable and subject to civil penalties for failing to safeguard electronic protected health information in accordance with the HIPAA Security Rule.

A written contract between a covered entity and a business associate must: (1) establish the permitted and required uses and disclosures of protected health information by the business associate; (2) provide that the business associate will not use or further disclose the information other than as permitted or required by the contract or as required by law; (3) require the business associate to implement appropriate safeguards to prevent unauthorized use or disclosure of the information, including implementing requirements of the HIPAA Security Rule with regard to electronic protected health information; (4) require the business associate to report to the covered entity any use or disclosure of the information not provided for by its contract, including incidents that constitute breaches of unsecured protected health information; (5) require the business associate to disclose protected health information as specified in its contract to satisfy a covered entity’s obligation with respect to individuals’ requests for copies of their protected health information, as well as make available protected health information for amendments (and incorporate any amendments, if required) and accountings; (6) to the extent the business associate is to carry out a covered entity’s obligation under the Privacy Rule, require the business associate to comply with the requirements applicable to the obligation; (7) require the business associate to make available to HHS its internal practices, books, and records relating to the use and disclosure of protected health information received from, or created or received by the business associate on behalf of, the covered entity for purposes of HHS determining the covered entity’s compliance with the HIPAA Privacy Rule; (8) at termination of the contract, if feasible, require the business associate to return or destroy all protected health information received from, or created or received by the business associate on behalf of, the covered entity; (9) require the business associate to ensure that any subcontractors it may engage on its behalf that will have access to protected health information agree to the same restrictions and conditions that apply to the business associate with respect to such information; and (10) authorize termination of the contract by the covered entity if the business associate violates a material term of the contract. Contracts between business associates and business associates that are subcontractors are subject to these same requirements.

This document includes sample business associate agreement provisions to help covered entities and business associates more easily comply with the business associate contract requirements. While these sample provisions are written for the purposes of the contract between a covered entity and its business associate, the language may be adapted for purposes of the contract between a business associate and subcontractor.

This is only sample language and use of these sample provisions is not required for compliance with the HIPAA Rules. The language may be changed to more accurately reflect business arrangements between a covered entity and business associate or business associate and subcontractor. In addition, these or similar provisions may be incorporated into an agreement for the provision of services between a covered entity and business associate or business associate and subcontractor, or they may be incorporated into a separate business associate agreement. These provisions address only concepts and requirements set forth in the HIPAA Privacy, Security, Breach Notification, and Enforcement Rules, and alone may not be sufficient to result in a binding contract under State law. They do not include many formalities and substantive provisions that may be required or typically included in a valid contract. Reliance on this sample may not be sufficient for compliance with State law, and does not replace consultation with a lawyer or negotiations between the parties to the contract.

Sample Business Associate Agreement Provisions

Words or phrases contained in brackets are intended as either optional language or as instructions to the users of these sample provisions.

Definitions

Catch-all definition:

The following terms used in this Agreement shall have the same meaning as those terms in the HIPAA Rules: Breach, Data Aggregation, Designated Record Set, Disclosure, Health Care Operations, Individual, Minimum Necessary, Notice of Privacy Practices, Protected Health Information, Required By Law, Secretary, Security Incident, Subcontractor, Unsecured Protected Health Information, and Use.

Specific definitions:

(a) Business Associate. “Business Associate” shall generally have the same meaning as the term “business associate” at 45 CFR 160.103, and in reference to the party to this agreement, shall mean [Insert Name of Business Associate].

(b) Covered Entity. “Covered Entity” shall generally have the same meaning as the term “covered entity” at 45 CFR 160.103, and in reference to the party to this agreement, shall mean [Insert Name of Covered Entity].

Obligations and Activities of Business Associate

Business Associate agrees to:

(a) Not use or disclose protected health information other than as permitted or required by the Agreement or as required by law;

(b) Use appropriate safeguards, and comply with Subpart C of 45 CFR Part 164 with respect to electronic protected health information, to prevent use or disclosure of protected health information other than as provided for by the Agreement;

(c) Report to covered entity any use or disclosure of protected health information not provided for by the Agreement of which it becomes aware, including breaches of unsecured protected health information as required at 45 CFR 164.410, and any security incident of which it becomes aware;

[The parties may wish to add additional specificity regarding the breach notification obligations of the business associate, such as a stricter timeframe for the business associate to report a potential breach to the covered entity and/or whether the business associate will handle breach notifications to individuals, the HHS Office for Civil Rights (OCR), and potentially the media, on behalf of the covered entity.]

(d) In accordance with 45 CFR 164.502(e)(1)(ii) and 164.308(b)(2), if applicable, ensure that any subcontractors that create, receive, maintain, or transmit protected health information on behalf of the business associate agree to the same restrictions, conditions, and requirements that apply to the business associate with respect to such information;

(e) Make available protected health information in a designated record set to the [Choose either “covered entity” or “individual or the individual’s designee”] as necessary to satisfy covered entity’s obligations under 45 CFR 164.524;

[The parties may wish to add additional specificity regarding how the business associate will respond to a request for access that the business associate receives directly from the individual (such as whether and in what time and manner a business associate is to provide the requested access or whether the business associate will forward the individual’s request to the covered entity to fulfill) and the timeframe for the business associate to provide the information to the covered entity.]

(f) Make any amendment(s) to protected health information in a designated record set as directed or agreed to by the covered entity pursuant to 45 CFR 164.526, or take other measures as necessary to satisfy covered entity’s obligations under 45 CFR 164.526;

[The parties may wish to add additional specificity regarding how the business associate will respond to a request for amendment that the business associate receives directly from the individual (such as whether and in what time and manner a business associate is to act on the request for amendment or whether the business associate will forward the individual’s request to the covered entity) and the timeframe for the business associate to incorporate any amendments to the information in the designated record set.]

(g) Maintain and make available the information required to provide an accounting of disclosures to the [Choose either “covered entity” or “individual”] as necessary to satisfy covered entity’s obligations under 45 CFR 164.528;

[The parties may wish to add additional specificity regarding how the business associate will respond to a request for an accounting of disclosures that the business associate receives directly from the individual (such as whether and in what time and manner the business associate is to provide the accounting of disclosures to the individual or whether the business associate will forward the request to the covered entity) and the timeframe for the business associate to provide information to the covered entity.]

(h) To the extent the business associate is to carry out one or more of covered entity’s obligation(s) under Subpart E of 45 CFR Part 164, comply with the requirements of Subpart E that apply to the covered entity in the performance of such obligation(s); and

(i) Make its internal practices, books, and records available to the Secretary for purposes of determining compliance with the HIPAA Rules.

Permitted Uses and Disclosures by Business Associate

(a) Business associate may only use or disclose protected health information

[Option 1 – Provide a specific list of permissible purposes.]

[Option 2 – Reference an underlying service agreement, such as “as necessary to perform the services set forth in Service Agreement.”]

[In addition to other permissible purposes, the parties should specify whether the business associate is authorized to use protected health information to de-identify the information in accordance with 45 CFR 164.514(a)-(c). The parties also may wish to specify the manner in which the business associate will de-identify the information and the permitted uses and disclosures by the business associate of the de-identified information.]

(b) Business associate may use or disclose protected health information as required by law.

(c) Business associate agrees to make uses and disclosures and requests for protected health information

[Option 2] subject to the following minimum necessary requirements: [Include specific minimum necessary provisions that are consistent with the covered entity’s minimum necessary policies and procedures.]

(d) Business associate may not use or disclose protected health information in a manner that would violate Subpart E of 45 CFR Part 164 if done by covered entity [if the Agreement permits the business associate to use or disclose protected health information for its own management and administration and legal responsibilities or for data aggregation services as set forth in optional provisions (e), (f), or (g) below, then add “, except for the specific uses and disclosures set forth below.”]

(e) [Optional] Business associate may use protected health information for the proper management and administration of the business associate or to carry out the legal responsibilities of the business associate.

(f) [Optional] Business associate may disclose protected health information for the proper management and administration of business associate or to carry out the legal responsibilities of the business associate, provided the disclosures are required by law, or business associate obtains reasonable assurances from the person to whom the information is disclosed that the information will remain confidential and used or further disclosed only as required by law or for the purposes for which it was disclosed to the person, and the person notifies business associate of any instances of which it is aware in which the confidentiality of the information has been breached.

(g) [Optional] Business associate may provide data aggregation services relating to the health care operations of the covered entity.

Provisions for Covered Entity to Inform Business Associate of Privacy Practices and Restrictions

(a) [Optional] Covered entity shall notify business associate of any limitation(s) in the notice of privacy practices of covered entity under 45 CFR 164.520, to the extent that such limitation may affect business associate’s use or disclosure of protected health information.

(b) [Optional] Covered entity shall notify business associate of any changes in, or revocation of, the permission by an individual to use or disclose his or her protected health information, to the extent that such changes may affect business associate’s use or disclosure of protected health information.

(c) [Optional] Covered entity shall notify business associate of any restriction on the use or disclosure of protected health information that covered entity has agreed to or is required to abide by under 45 CFR 164.522, to the extent that such restriction may affect business associate’s use or disclosure of protected health information.

Permissible Requests by Covered Entity

[Optional] Covered entity shall not request business associate to use or disclose protected health information in any manner that would not be permissible under Subpart E of 45 CFR Part 164 if done by covered entity. [Include an exception if the business associate will use or disclose protected health information for, and the agreement includes provisions for, data aggregation or management and administration and legal responsibilities of the business associate.]

Term and Termination

(a) Term. The Term of this Agreement shall be effective as of [Insert effective date], and shall terminate on [Insert termination date or event] or on the date covered entity terminates for cause as authorized in paragraph (b) of this Section, whichever is sooner.

(b) Termination for Cause. Business associate authorizes termination of this Agreement by covered entity, if covered entity determines business associate has violated a material term of the Agreement [and business associate has not cured the breach or ended the violation within the time specified by covered entity]. [Bracketed language may be added if the covered entity wishes to provide the business associate with an opportunity to cure a violation or breach of the contract before termination for cause.]

(c) Obligations of Business Associate Upon Termination.

[Option 1 – if the business associate is to return or destroy all protected health information upon termination of the agreement]

Upon termination of this Agreement for any reason, business associate shall return to covered entity [or, if agreed to by covered entity, destroy] all protected health information received from covered entity, or created, maintained, or received by business associate on behalf of covered entity, that the business associate still maintains in any form. Business associate shall retain no copies of the protected health information.

[Option 2—if the agreement authorizes the business associate to use or disclose protected health information for its own management and administration or to carry out its legal responsibilities and the business associate needs to retain protected health information for such purposes after termination of the agreement]

Upon termination of this Agreement for any reason, business associate, with respect to protected health information received from covered entity, or created, maintained, or received by business associate on behalf of covered entity, shall:

Retain only that protected health information which is necessary for business associate to continue its proper management and administration or to carry out its legal responsibilities;

Return to covered entity [or, if agreed to by covered entity, destroy] the remaining protected health information that the business associate still maintains in any form;

Continue to use appropriate safeguards and comply with Subpart C of 45 CFR Part 164 with respect to electronic protected health information to prevent use or disclosure of the protected health information, other than as provided for in this Section, for as long as business associate retains the protected health information;

Not use or disclose the protected health information retained by business associate other than for the purposes for which such protected health information was retained and subject to the same conditions set out at [Insert section number related to paragraphs (e) and (f) above under “Permitted Uses and Disclosures By Business Associate”] which applied prior to termination; and

Return to covered entity [or, if agreed to by covered entity, destroy] the protected health information retained by business associate when it is no longer needed by business associate for its proper management and administration or to carry out its legal responsibilities.

[The agreement also could provide that the business associate will transmit the protected health information to another business associate of the covered entity at termination, and/or could add terms regarding a business associate’s obligations to obtain or ensure the destruction of protected health information created, received, or maintained by subcontractors.]

(d) Survival. The obligations of business associate under this Section shall survive the termination of this Agreement.

Miscellaneous [Optional]

(a) [Optional] Regulatory References. A reference in this Agreement to a section in the HIPAA Rules means the section as in effect or as amended.

(b) [Optional] Amendment. The Parties agree to take such action as is necessary to amend this Agreement from time to time as is necessary for compliance with the requirements of the HIPAA Rules and any other applicable law.

(c) [Optional] Interpretation. Any ambiguity in this Agreement shall be interpreted to permit compliance with the HIPAA Rules.

An electronic medical record (EMR) contains the standard medical and clinical data gathered in one provider’s office. Electronic health records (EHRs) are broader in scope, going beyond the data collected in one provider’s office to include a more comprehensive patient history. For example, EHRs are designed to contain and share information from all providers involved in a patient’s care. EHR data can ideally be created, managed, and consulted by authorized providers and staff from across more than one health care organization. The federal Department of Health & Human Services is rapidly encouraging general adoption of “Certified EHRs” that are capable of this.

As medical care grows more and more complex, a greater and more seamless flow of information within a digital health care infrastructure, created by electronic records, is expected to enhance the way care is delivered and compensated. This idea has been promoted by the Obama administration, with strong bipartisan and industry support. Aided by provisions in the HITECH Act (part of the American Recovery and Reinvestment Act of 2009), the Department of Health and Human Services is offering financial incentives to hospitals and physician practices that can achieve what it calls “meaningful use” of certified EHRs by certain dates. Providers who fall behind in achieving meaningful use will eventually receive lower reimbursement rates for treating Medicare patients.

Health care organizations are moving rapidly to digitize new and existing patient records to improve efficiency, reduce costs, enhance patient care and meet the government’s goals for adopting Electronic Medical Records. While the EMR promises great benefits, such as quickly and effectively providing access to the right records throughout the treatment cycle and across a health system, information management also poses great challenges, especially in the area of compliance. Paper records must be scanned, converted to digital, and managed throughout the process in a manner that is secure, compliant1 and cost-effective.

HIPAA compliance plays a critical role in document conversion and the transition to electronic records. Document conversion, by itself, is a straightforward process. Documents are scanned in a digital format and transmitted directly into the EMR system. However, the conversion process raises many complex issues related to compliance. For example:

How will you store electronic records in a way that makes them accessible, compliant and affordable?

Will you be able to maintain retention and destruction schedules that meet regulations and your own requirements so you store only the records you need to store, whether paper or digital?

The HIPAA Privacy Rule is intended to ensure that Protected Health Information (PHI) is not used or disclosed inappropriately or without the patient’s general consent or specific authorization. The Security Rule is specifically designed to protect PHI that is used and stored electronically (ePHI). Both aspects of the rule apply to document conversion. HIPAA rules cover three broad areas of activities to ensure secure records storage:

Administrative Procedures: Operational processes and procedures, such as training, workflow, and the release of information, to ensure that information is always handled according to policy. This section of HIPAA also requires a contingency plan, also known as a disaster recovery plan (data backup and archiving services).

Physical Safeguards: Physical controls, such as locks, access to keys and supervision, to protect against unauthorized physical access.

Administrative Procedures: HIPAA requires that PHI and ePHI be protected and secured throughout all stages of document conversion. This means that documented procedures for operational processes such as training, workflow and contingency planning must be put in place to ensure that information is always handled according to policy.

EMR software or services must meet this requirement in several ways:

Physically restricting access to customer public health information during transit, conversion, storage and disposal of both the original paper documents and the converted electronic records.

Electronically tracking and maintaining an auditable log of all tasks and operations performed.

Providing tools to manage how employees access digital records, as well as workforce training and management: HIPAA requires training of workers who handle PHI.

Contingency planning for document conversion and implementation of disaster recovery services. These may include centralized management of information and back up systems, as well as maintenance of an auditable trail of all activities related to document conversion.

Physical and Technical Safeguards: HIPAA requires safeguards for data-related information systems and associated controls, such as database security, network protection and user authorizations and passwords, which protect ePHI and control access to it. Processes should be in place to safeguard data at all stages of document conversion. Furthermore, HIPAA requires documentation that records are protected throughout their lifetime, up to and including their destruction.

Technical safeguards include:

Firewall and virus protection.

Secure password protection.

Role-based access rules, so users can access only the software and data to which they have been granted access.

Unique user IDs to identify and track user identity.

Direct integration with major EMR systems or delivery via a secure FTP site.

Health care data encryption, or a form of data security whereby electronic medical records are disguised so that unauthorized users may not read or make sense of them.

When designed and implemented well, EMRs offer significant benefits toward improving overall quality of care, increasing care efficiency and reducing healthcare costs. Thus, selecting an EMR system is a critical decision and a significant planning task. The Regional Extension Centers (RECs) thus recommend the following steps in transitioning to EMR:

1. Assess Your Current Practice

The assessment should look at the current state of the practice.

Are administrative processes organized, efficient, and well documented?

Are clinical workflows efficient, clearly mapped out, and understood by all staff?

Are data collection and reporting processes well established and documented?

Are staff members computer literate and comfortable with information technology?

Does the practice have access to high-speed internet connectivity?

Does the practice have access to the financial capital required to purchase new or additional hardware or software?

Are there clinical priorities or needs that should be addressed?

Does the practice have specialty specific requirements?

2. Envision the Future

The next EMR implementation step is to envision the future state of the practice. What would the practice leadership like to see different in the future? More specifically:

What will be different for the patients?

What will be different for the providers?

What will be different for the staff?

3. Implementation Planning

Analyze and map out the practice’s current workflow and operating processes.

Map out how EMRs will enable desired workflows and processes, creating new workflow patterns to improve inefficiency.

Create a contingency plan to address issues that may arise throughout the implementation process.

Create a project plan for transitioning from paper to electronic medical record keeping.

Identify concerns and obstacles regarding privacy and security and create a plan to address them. It is essential to emphasize the importance of privacy and security when transitioning to EMRs.

4. Software Comparison

After establishing the practice’s objectives and planning how electronic record keeping will affect workflows, the leadership can determine what to look for when considering and selecting an EHR system. The following are several considerations for EMR software comparison:

Look for CCHIT certification **This certification ensures that the system or software has been reviewed by the federal government and has passed the minimum requirements for security. Certification further indicates, since the price of EMR can be substantial, that the software has sufficient financial backing to remain in business.

Understand if and how a vendor’s product will accomplish the key goals of the practice. Look for software that will allow provider input in establishing unique templates and patterns.

Consider server options (client server, application service provider (ASP), software as a service (SAS)). A note on ASP capability- Particularly for practitioners that do not have an IT person on staff, having a secure third party service host the software, take care of the upgrades, handle the support, and manage the back-ups for a monthly fee is a recommended way to go to EMR.

Ability to integrate with other products (practice management software, billing systems, and public health interfaces). Note- It is essential that the EMR system have the ability to connect with most practice management systems. Being able to use HL7 (Health Level 7) protocols for transferring information, for example, is the gold standard in the healthcare field.

Privacy and security capabilities and back-up planning.

Vendor’s stability and/or market presence in region.

Cost to connect to Health Information Exchange (HIE)- Consider costs of using legal counsel for contract review verses open sources through medical associations.